Promoting ease of doing business at IKN, govt issues Government Regulation 12/2023

This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.

Investor Daily - Dorong kemudahan usaha di IKN, pemerintah terbitkan PP 12/2023

9 March 2023


Jakarta - The government has issued Government Regulation No. 12/2023 on Granting of Business Licensing, Ease of Doing Business, and Investment Facility to Business Players in Nusantara Capital City (IKN).

The purpose of this regulation is to provide certainty, opportunities, and a larger participation for business players to accelerate Nusantara development to balance construction and drive Indonesia’s economy in the future.

IKN Authority Head Bambang Soesantono stated that Government Regulation No. 12/2023 is proof that the government is serious about providing legal certainty and ease of business for business players who want to participate in Nusantara development.

“The purpose of the issuance of the regulation is very positive, and I believe that it can accelerate IKN development with investments from domestic and foreign private companies,” he explained in a written statement on Wednesday (8/3/2023).

Bambang explained that the issuance of this government regulation is an embodiment of President Joko Widodo’s direction to present an attractive policy package with various maximum incentives in the applicable law corridor.

Government Regulation No. 12/2023 includes five regulation scopes, namely business licensing, ease of doing business, investment facilities, supervision, and evaluation. There are 12 articles on business licensing, 10 articles in ease of doing business, 42 articles on investment facilities, 2 articles on supervision, and 1 article on evaluation.

“The people are expected to fully study Government Regulation No. 12/2023 so that they can understand it wholly to prevent misconceptions,” Bambang explained.

Government Regulation No. 12/2023 also regulates the 0% final income tax facility on income from gross turnover of certain businesses received by micro, small, and medium enterprises (MSMEs) in Nusantara. “This regulation also sides with MSMEs that are one of the pillars of Indonesia’s economy,” the IKN Authority explained.

Bambang also said that the government will also issue derivative legal products from this government regulation that will in detail regulate the implementation of the government regulation. “Derivative regulations will be issued soon by related ministries/institutions, such as a Finance Minister Regulation and an IKN Authority Head Regulation that will explain the mechanisms and procedures of Government Regulation No. 12/2023,” he explained.

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